Our Family Guidelines for Using Credit Cards

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I mentioned yesterday that our family has decided that we spend less when we use cash instead of credit cards.  Yet, I mentioned that we do still have and use credit cards.

Photo by mangpages.

Here are our family credit card guidelines:

  1. If we are going to buy a single item purchase over $100 and we decide to buy it before going to the store, we will use a credit card.  Here’s why.  Purchases over $100 are typically items where credit card benefits like lowest price guarantee and extended warranties are beneficial.  Second, we still want to take advantage of credit card rewards as long as we are not paying more for them.  We figure any decision we make before going to the store would not be altered by our method of payment.
  2. If it is a normal, reoccurring charge, we use the credit card because once again we know how we pay won’t impact what we pay.
  3. If we purchase something online we use a credit card because there is no difference between a credit card or debit card, so we take advantage of the points.
  4. If a gas station requires you to prepay I use the credit card because I don’t want to guess what it will take to fill the tank.  It is not worth the extra hassle to use cash.
  5. With car rentals we always use credit cards because of the insurance coverage.

I should note that we pay off our balance every month and have never paid any excess fees with a credit card.  If we had to pay a fee we would get rid of the card.

In order to feed my appetite for credit card travel promotions I apply for credit cards, use them once (or whatever the minimum is) and then we don’t use the cards after that.

I still find it hard to use cash instead of credit cards because my mathematical brain calculates all my missed points opportunities.  Fortunately, my wife tends to have better intuition with money and her feelings are right more often than my calculations.

Truth is the only way to know if using cash could save you money is to try it out, track it and then you can be the judge.  If there is a particular area of spending you are specifically concerned about, at the very least try paying everything in that category with cash just to see if it makes a difference.


  1. Deborah says

    What if Credit cards is not what’s keeping you in debt? What if cashflow is the problem? I have a close relative who’s in debt not because of credit cards but because of everything else food, utilities, home maintenance, car maintenance (car is paid for) etc. how do we control spending or budget then?

    • says

      If such a person is living on a budget and is still finding a cash flow issue then I’d suggest that the issue might be one of income. The more a person makes the easier it will be to meet those expenses.

  2. Ian Turner says

    How long did it take you to get in the groove paying with cash? If I am going to try this, how long of a trial would you recommend to get realistic results?

    Blessed Be. -Ian

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